Online Click-Through Stats: Love 'Em or Leave 'Em?

By Michael Mahoney
Jul 10, 2001 6:16 PM PT

Analysts disagree on whether Monday's announcement by CBS MarketWatch --
that the financial
Web site will stop providing its clients with click-through rate information in its
advertising reports -- will cause the e-commerce industry to break free of the
click-through status quo.

In a direct shot at the industry's most popular and controversial online advertising
metric, MarketWatch said that although click-through rates will still be made available
to advertisers by request, MarketWatch client reports will focus on other metrics
commonly used in the offline world, including those used to measure ad campaign reach,
post-impression analysis and brand awareness.

Jupiter Media Metrix analyst Rudy Grahn thinks that MarketWatch has perhaps shot itself
in the foot with the move.

"Ultimately, they have gone too far with this," Grahn told the E-Commerce Times, adding
that while the click-through rate should not be a primary metric, "it should be a
metric most advertisers should be looking at for all of their campaigns."

A Fair Shake?

While Grahn dismissed the idea that the MarketWatch move would be the catalyst for a
much larger online trend away from click-throughs, Yankee Group analyst Michele Pelino
told the E-Commerce Times that a revolution is possible, especially in industries
that are heavily focused on branding, such as the entertainment and travel sectors.

Pelino said that there are better ways than click-throughs of measuring how much brand
impact an online ad is having, including measuring the amount
of time people spend with an ad and the number of interactions they have with it.

"My question is, 'What kinds of metrics will [MarketWatch] release to their
advertisers?' Advertisers need some way of analyzing their ads," said Pelino.
"There needs to be a give and take."

Pelino added that while the decision-makers at MarketWatch are forcing the issue on
click-through rates, "behind this needs to go an education process for
advertisers, and that may be where the challenge lies."

The First Shot?

Grahn said that even though he understands the reasons for the MarketWatch move,
which include the desire to be judged by the same metrics that offline companies are,
approximately 60 percent of online advertisers are still using click-throughs as
their primary metric.

"They are getting hammered hard to demonstrate an advertiser's ROI (return on investment)
on such a short cycle, and if they are only going to be valued by the number of clicks,
they will never get a fair shake and they are right about that," Grahn said. "It's not
an either/or choice. Companies should be measuring both the branding and direct response."

In addition, Grahn said that advertisers are by no means dependent
on e-commerce companies themselves to get click-through data,
because they can get the same information from a third party.

First Move

Pelino said that MarketWatch's new policy is the first example that she has heard of
an e-commerce company making such a move against click-throughs.

"It's unprecedented as far as I can tell," Pelino said. "We would say this is a good
thing. It pushes advertisers to consider other metrics that would be much more reflective
of the impact of the advertisement."

The problem with click-throughs, Pelino said, is that they do not have much to do with
whether an ad is having the impact a company wants it to.

However, Grahn disagrees with the general consensus regarding click-throughs.

"It's not true when people say they're 'virtually meaningless,'" Grahn said. "I can't
think of a good reason not to track it."